LMIA Wage Requirement

LMIA Wage Rate

The LMIA wage is the minimum hourly rate that must be offered to foreign workers. This baseline, established by the government, stipulates the rate businesses must offer and adhere to when seeking to hire foreign workers. The LMIA wage may increase slightly each year due to nationwide wage updates by the government. Employers who have already hired foreign workers based on the LMIA should update their wage rates accordingly.

It's important to note that the LMIA minimum wage is distinct from the minimum wage in specific provinces of Canada and should not be confused with the latter. Below are the rules for determining the LMIA wage if a company intends to hire a foreign worker.

Defining LMIA Job Offer Wage

The LMIA wage is determined based on two criteria. The employer must pay the higher of the two, known as the "prevailing wage":

• The occupational median wage for the job's location, or
• The current wage rate earned by staff in the same position with the same skill set.

Example 1

For instance, if an employer in Toronto wants to hire a foreign worker as a Software Engineer, they would need to offer at least CAD 52.88/hr. The occupational median wage for a Software Engineer (NOC 21231) in Toronto is CAD 52.88/hr. This rate can be determined using the Job Bank Wages search tool.

Example 2

Suppose a company in Vancouver is hiring a Transport Truck Driver. The occupational median wage for a Transport Truck Driver (NOC 73300) in Vancouver is CAD 27/hr. However, the company's current drivers with the same skill set earn CAD 30/hr. Therefore, the minimum wage offer for a foreign truck driver must be the higher wage, which is CAD 30/hr.

Wage Determines LMIA Stream

Correctly defining the wage rate at the onset of the LMIA process is crucial. Once the wage is set, it dictates the stream under which an LMIA application should be filed, as well as the subsequent requirements.

Employers must compare the set wage rate with the provincial median hourly wages, as provided in the table below.

Employers should apply under the High-Wage LMIA stream if the LMIA wage rate meets or exceeds the provincial or territorial median hourly wage [see table below]. If the wage rate is lower, the Low-Wage LMIA stream is appropriate. However, for certain job types like agricultural workers, in-home caregivers, and some tech occupations, specific LMIA streams apply regardless of the wage rate.

While some jobs have their own LMIA streams, the wage rate is crucial for determining advertising requirements, setting the maximum employment period (2 or 3 years), and ensuring employer responsibilities like paying for round-trip transportation and ensuring affordable housing for foreign workers for either high-wage or low-wage category job.

It is crucial to clearly state the accurate LMIA wage in job advertisements during the recruitment process, as required.

Provincial Median Wage

Annual LMIA Wage Review (Employer’s Ongoing Compliance)

In the sections above, we discussed how to determine the LMIA wage rate and its influence on the selection of the LMIA stream, job advertising, maximum employment duration, and certain additional obligations, such as transportation and housing for a foreign worker.

It's important to emphasize that an approved LMIA includes a specific hourly wage rate. This means that the employer is obligated to pay this stipulated LMIA wage rate to a foreign worker and cannot reduce it. However, if the prevailing wage rises, employers are expected to review and adjust (if necessary) the wage of the temporary foreign worker annually by January 1 of each year. This ensures compliance with the LMIA wage requirement.

Start LMIA

Depending on business conditions, stages, and needs, there are specific steps to follow in the LMIA process.

If you are looking for a corporate immigration law firm or lawyer in Canada, we are here based in Toronto to help. Call us at +1-416-915-0808 or email info@leromlaw.com for additional information you need to start the process.